The Wind Production Tax Credit is a perverse policy that pays utilities to slow down or shut down reliable power plants whenever the wind blows. It is driving reliable power plants out of business, leading to higher costs and lower reliability.
Denmark and Germany, the two most aggressive pursuers of solar and wind electricity in Europe, have the highest household electricity prices in the EU according to Eurostat. To a large degree this is driven by subsidies for solar and wind directly impacting the consumer bills but also less directly observable cost solar and wind create on an electric grid. Because of their intermittency, both technologies require [additional infrastructure and permanent backup](https://www.forbes.com/sites/michaelshellenberger/2018/04/25/yes-solar-and-wind-really-do-increase-electricity-prices-and-for-inherently-physical-reasons/) by conventional capacity.↩
“For example, on wind energy, we get a tax credit if we build a lot of wind farms. That's the only reason to build them. They don't make sense without the tax credit.” -Warren Buffet cited by U.S. News/Nancy Pfotenhauer↩
“Changes in annual capacity additions for wind in the United States are often explained by changes to tax incentives. The U.S. production tax credit (PTC), which provides operators with a tax credit per kilowatt hour of renewable electricity generation for the first 10 years a facility is in operation, was initially set to expire for all eligible technologies at the end of 2012 but was later retroactively renewed. The high level of annual capacity additions in 2012 was driven by developers scheduling project completion in time to qualify for the PTC. Similarly, the increase in annual capacity additions for wind scheduled for 2019 is largely being driven by the legislated phaseout of the PTC extension for wind.” - U.S. Energy Information Administration, May 15, 2019↩
In Texas, the grid’s reserve margin—the amount of capacity it has above expected peak demand—has shrunk so much that the Public Utilities Commission of Texas called the situation “very scary.” -Utility Drive, January 22, 2019 For example, a 2019 story concerning Texas notes, “As wind power slowed, ERCOT instituted its first level of emergency alerts, calling on small industrial and commercial generators to pour power onto the grid, and requesting power from Mexico from which an additional 60 MW were imported on Aug. 15. Installed capacity numbers for electricity from intermittent sources such as wind and solar mean very little when they fail to produce as wind did in the middle of the hot Texas summer.” -Power Magazine, September 19, 2019
In the U.S. northeast, grid operator ISO-NE warned, the grid is likely to be at risk of fuel shortages and rolling blackouts thanks to limited natural gas pipeline capacity. “In the coming years as more oil, coal, and nuclear leave the system, keeping the lights on in New England will become an even more tenuous proposition.” -ISO New England, 2018 Regional Electricity Outlook.↩